The state government has announced a five percent hike in Dearness Allowance (DA), which will benefit around 5 lakh employees and pension holders. After the hike implementation, the net DA now stands at 17%. A communication from the Chief Minister’s Office clarified that the hike would be implemented with a retrospective effect from the first of January, 2020.
Around 3.5 lakh employees and 1.5 lakh pension holders are supposed to benefit from the order. Officials from the Finance Department estimate an additional burden of ₹150 crores to the exchequer, in exchange for the high payouts from the state treasury.
In another separate decision, the government has decided to clear ten percent arrears pending in view of the recommendations made by the 7th Central Pay Commission (CPC). Recommendations made by the 7th CPC were implemented in the state from September of 2017, against the scheduled period of January 1, 2016.
Earlier, the state government had cleared forty percent of employees during three financial years. The additional 10% approval for arrear clearance will have a net burden of ₹500 crores on the exchequer, as per official sources.